Prediction-market platform Kalshi has quietly funded a new trade group as the industry braces for intensifying pressure from casinos, sportsbooks, state regulators and lawmakers.
The coalition, Americans for Fair Markets (AFM), launched this week with Taylor Budowich — a former deputy White House chief of staff under Susie Wiles — named as a strategic advisor. Kalshi says AFM will push federal policy that preserves regulated, federally supervised prediction markets and fight what it calls “false narratives about prediction markets” coming from gaming interests.
AFM’s stated priorities include:
- Strong know‑your‑customer checks
- Bans on insider trading in event contracts
- Full funding for the Commodity Futures Trading Commission (CFTC)
- Limits on contracts tied to war, death, terrorism and assassination
The move gives Kalshi a direct political channel in Republican circles. John Bivona, Kalshi’s head of government relations and an AFM board member, framed the effort as a defensive response to entrenched gaming interests: “We’re not going to be outspent or out‑organized by entrenched interests protecting their monopolies,” he said.
The timing is notable. The U.S. House Committee on Oversight and Government Reform has opened an investigation into Kalshi and rival Polymarket, requesting records on user screening, geographic limits and controls for suspicious trading. The probe follows concerns that people with non‑public government information could profit on event contracts, reports of suspicious trades tied to geopolitical events, and a recent case in which a U.S. Army master sergeant is accused of using classified information to net more than $409,000.
Kalshi argues prediction markets should remain under CFTC oversight, but state regulators counter that many event contracts—especially those linked to sports—are subject to state gambling laws. That jurisdictional fight escalated after Kalshi and Polymarket lost emergency appeals in Nevada and Washington; a Ninth Circuit panel ruled that a federal derivatives defense does not automatically move state gambling cases into federal court.
Beyond advocacy and litigation, Kalshi is quietly moving toward larger financial use cases. Wall Street research and market participants have pointed to Kalshi’s first bespoke block trade as a step toward institutional event‑risk trading, and prime broker Clear Street has added a regulated access route for bigger clients. Kalshi has also surfaced in reports about crypto perpetual futures and deals to distribute its real‑time market probabilities to media: Fox plans to stream its data across Fox News, Fox Business, Fox Weather and Fox One after earlier integrations with CNN and CNBC.
For crypto and fintech observers, Kalshi’s backing of AFM underscores a broader regulatory and commercial inflection point: prediction markets sit at the intersection of derivatives, gambling law and data/crypto innovation, and industry players are now investing in politics and policy as much as product development.
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